revised edition, hehe...
the dot.com thing
why was it important to understand? what was it? what happened, and why? was there anything left, or is it still happening? what is the difference of what went wrong economically then, compared to what is going wrong today?
all of these questions have been posed before ad nauseum, but in my humble opinion, too often these questions have been asked and answered from irrelevant or confusing perspectives, indeed usually from those who've largely failed at speculation in it, or advocated the worst behavior up till now.
plenty of misleading principles have also been associated with the time period, and often go on to create other points of misunderstanding. the airwaves and industry rags are overflowing with articles from people who never had to deal with the day to day problems, or who were in a position of ownership but without practical understanding of what exactly they owned.
i believe much of the fallout from the latest round of corporate scandals are evidence of exactly this kind of incompetence, or utter lack of awareness, more than they reflect a subset of criminals gone mad with a hazy rule set.
why was it important to understand?
while much of the period included a lot of flighty language about futurist's predictions of how technology was changing our world, the reality was - technology was rapidly changing our world. concepts like networked computing (internet, email, the web), wireless networks (cell phones), and microprocessors (which were suddenly in every application we used daily, like cars) were changing the very nature of how organizations came together and functioned.
the phrases commonly heard, eg "paradigm shift", "digital revolution", and "information age" were more than buzzwords. they were actually quite accurate, and we have still to really understand just how fundamentally our world expectations shifted over the course of the 90s.
the really hardcore changes occurred, and are still occurring, out in the business world. much like the industrial revolution's slow 'progress' out into the home (the 50s in America, for example, where dishwashing machines and washer-dryers began pervading suburban homes), the digital revolution has yet to fully work it's dynamics out into everyday life, while much of our lives have been radically transformed nonetheless.
so much so, some would argue, that our ability to "feel" the roads we traverse diminishes with every luxury we add via our technological progressions. the more we can hide our natural bodies from the harsh realities of the world around us created in that pursuit of comfort, the less we can feel the impact of our actions, goes the argument.
but the other critical area people must be concerned about in understanding our recent history, is the key understanding that the new dynamics bring a whole series of new concerns which even today remain largely unknowns, and primed for exploitation.
the dot com era was one of exactly that, the exploitation of people's imagination. but there was some rather important logic behind the facades. and that logic remains largely in tact today, it's just unrealized potential at the moment. potential that can't really be touched until a number of other factors come back into line, namely the older economic principles which are still being rocked by the waves of the digital revolution, but also corporate scandal and abuse.
but potential nonetheless, and any way you care to look at it. potential for massive capitalism. potential for successful political and civil movements. potential for corporations, good and bad alike. potential for education. potential for terror. potential for every aspect of society you can imagine and then some, and the potential for both wonderful breakthroughs, and also miserable failures.
but it is difficult to look at that reality with any sense of positivity when you only look at certain aspects of the revolution. the key points of understanding lie in an overall understanding of how the technology will impact all areas of life. or more precisely, the spectrum of potential, as the potential is not limited to purely 'positive' effects, or even tangible ones.
so, just looking at something like the internet as a source of revenue is rather pointless unless all you care to do is make a quick dime. having a broad understanding of the needs of education, but lacking the technical ability to envision the kind of application that would revolutionize education, is not going to let us take advantage of that potential either.
and yet when you look carefully at how most of our critical planners and designers are positioned in society, it is easy to understand how it's going to be quite some time before we really do take advantage of what we have available to us.
as i understand it, the tv and video machine are critical tools in modern education, and i know in the business world they are considered extremely effective educational tools. but these tools were available to us back in the early part of the 20th century, why is it we didn't really see these tools available and in wide use until the late 20th century?
these are the kinds of realizations we need to make about our predicament today, and there is much for us to learn by understanding the dot com era. by understanding the dynamics of the technology shift that occurred, we can understand what still isn't obvious to us today. but more importantly, by understanding the poor judgements that occurred in the dot com era, as well as the few correct judgements, we can begin to understand what we are missing today and why.
however, there is one other final thing we can gleen from understanding the misrepresentation of the dot com era, and that is how our modern corporations seem to be displaying out of control criminal behavior. many people see a simple continuation of the 'misdeeds' from the dot com era, but i think that would be unwise. there are a few similarities, and a few exceptions of course, but in general, the problems of then versus now are fundamentally different.
what was it?
many things occured, forces met and dynamics mixed during the dot com period. describing it precisely, while nearly impossible, will also vary greatly depending on what specifics you care to cover.
as this is written from my perspective, i will simply recall my relationship to it.
i was introduced to personal computing in the early 80s as a young child, when my parents were aspiring to be systems analysts (computer managers), and had a PC in the home. many kids on my block had apples and PCs, and eventually commodores and ataris and amigas and other assorted PCs too.
i was something like 12 when PacMan came out nationally, and i remember getting excited about the major jumps video games had made from Space Invaders to Tron in the mid 80s, as point of reference.
i was raised on television. i have decades of commercials etched permanently on the back of my head, and thus found advertising a natural fit.
i have about 6 years experience working with people on phones. be it customer service for a battery of internal reps, where there is no real conflict, to straight forward telemarketing where you are the world's greatest antagonist and boob, and in addition i have another decade of administrative experience where my duties centered around getting other companies to do things for my company, from shippers to suppliers to consultants to partners to clients.
i have always found computers intuitive, and have been able to constantly learn how to exploit new tools as they become available to the medium, be they graphic tools, analytical tools, communications tools or just a solid understanding of the implementation of these things for others.
with that history, i found myself in the mid-90s sitting about 5 years into a promising marketing career. i had racked-up by that point an impressive collection of well-rounded marketing and business admin experiences which had me well-versed in marketing fundamentals, and managed to land a job at an advertising agency in london, one of the world's premiere advertising markets, second only to madison avenue, and only in revenue.
in fact, even more appropriate, i was working in an ad agency that focused on the IT sector. which means i was talking daily with media reps from all the computer press, and was going through stacks of every computer magazine available in europe every day. i was getting little perks from these companies via my elder media buyers and therefore could swing having an internet connection in 1995 when i was too broke to even afford my cold flat in london.
but as an american in london, the internet was a breakthrough for me. the appeal of being able to contact all my old american friends daily without having to swing 20 or 40 pounds for the 20 minute phone call, was just undeniable. that allure, in turn, provided me with the motivation to simply learn the basics of the net inside and out, and within weeks was developing web pages, as i discovered more and more just how easy the technology was - well, easy for someone who coded simple macros in wordperfect for years, which had the exact same basic principles behind it as html.
by the end of the year i was moonlighting as an html coder for designs that had been done by the studios' graphic designers. at that time, graphic designers were largely ignorant to the limitations of the medium or the use of the web, because they had never tried to read an html page themselves - so with my few years experience as a production artist combined with my intuitive knowledge of development constraints for the web, i began to realize i could do graphic design on-screen very well and do circles around designers who knew very little about the web.
within a year i was freelancing, and had returned to my home state of california, but this time landed up in silicon valley. and while this was still before Bill Gates had technically "got" the web, i was still very much aware of how much of a late comer i was to the dot com game.
but it was 1996, and i was working as a production artist on the FedEx website from a casual office in Cupertino, just around the corner from Apple's illustrious campus, and right up the street form the world's cheapest sushi joint, Miyaki.
the company i was working with was owned by a small trio of characters, but actually run by only one of those individuals. the elder of the three, he was also the one to have put most of the capital into the company, as well as brought the credibility and know-how to most of what the company's value was derived from.
the problem was he was a lousy manager, and had miserable notions of how to get along with other people. he had a nasty habit of telling his top clients they were stupid to their face. literally using those words, and in a typical engineer manner, never realising nor intending to be offensive in the process.
it was clear to me he completely lacked any of the "account management" principles i was well versed in from my london marketing days, and years of sales experience. and after a few months of this kind of management, the company was starting to fall on hard times.
that's right - in the middle of the best possible time to be a be development shop, with perhaps the most successful commercial web site ever to their ultimate credit, they were falling on hard times. there are plenty of stories that describe this amusing reality but they would involve naming names and speculating on motives i'd rather not guess about. but the reality remained.
so a number of us - mostly the young ones doing the day-to-day work of dealing with the clients, designing the sites and executing the work - decide to leave that company, and start our own company. while the initial group was more like 6 people, 3 of us in the end decided to make the leap of faith and start our business.
very typical dot com story in many respects, we were fundamentally different than others in many important ways, and ways that never get talked about in the aftermath of the dot com era - we were quite legitimate.
in fact, fundamentally we were identical to any advertising agency that has ever existed in terms of how our value was derived and maintained. and we were damned good at what we did, because we were young and hungry and knew what we were doing in an ocean of people who simply did not.
we decided to have a web shop that 'cut out all the crap', and that would work in untraditional relationships without fear. so, unlike most other web shops, we would happily work for a competing advertising or web shop, to give them the appearance of knowing what they were doing (ie, we were invisible to their client), understanding we'd never have control of the account. or we would often remove certain roles in a given process altogether, because they were really just ways of pumping up our asking costs and the client wasn't aware there was no real reason for that industry norm other than profit, or some would say gouging.
we knew a lot of the secrets of how to pump up percieved value, and decided to make our selling point that we could identify and remove those needless costs.
so for example, to sell fortune 500 corporations at the time on your web development shop, you often had to portray yourself as having hundreds of people on staff milling around waiting for some work to do. this was a legacy belief from other dsiciplines which required massive teams of people to manage. A typical Ford advertising campaign, for example, which has some response mechanism in it, might take hundreds of people to process those hundreds of thousands of responses, which Ford's marketing masters then turn around and interpret the data produced, and act on the mechanisms in place to get people to buy into their marketing schemes.
so when a Ford contemplates building their first web site, bearing in mind the grandiose promises of the few web presentations they saw which sold them on the concept of the internet in the first place - they immediately assume, "we need hundreds of people to manage this thing right".
these are top notch marketers. when they do something, they do it right, and spending millions of dollars is not a problem. in fact, not spending millions of dollars and expecting to do it right is often what makes people bad marketers, or ineffective ones.
so Ford expects to have to spend millions on their website.
what they didn't realize, along with many others who still don't - is that back then, and to some extent even today, after a certain number of people, adding more people to the mix actually makes web development and managment more difficult, expensive and problematic.
but web developers, following the advertising model, mostly charged for their services per person, and by the hour. so they don't want anyone thinking that you are better off with a 5-person team than a 100-person team managing the premier account of the agency.
our group liked to call out our competitors on that one. and we got a lot of business that way. so much so, that our company never borrowed any money. not once. the closest we got was we once arranged to have 10k credit limit, but never ended up using it.
we never advertised. we ran one email campaign that was semi-successful, but uneccessary in the end, and 99% of our business came word of mouth.
having started the business in 1997, by the end of 1999 we were 30 people strong, had two offices in two of the more expensive areas of the san francisco bay area (sausalito and mill valley) and were turning around about 1 million dollars a month in revenue.
we sold the company to Canada's largest web developer in early 2000 for a value of over (US) 50 million dollars.
we never once talked to venture capitalists, we never once accepted money to pump the value of our company, and we sat in the black the entire time.
our employees were paid above industry average and had recieved well over industry average of ownership, many of which actually managed to sell while the (canadian) stock had value still. i'm aware of 3 businesses which exist today from former employees of that business, some of which employ employees from that original company.
our business was to give everyone else in business some capability of understanding the internet and doing something with it at a sane cost.
we were in direct competition with most of the sexier shops who were wanting 10 times the development cost for stuff that won eye-grabber awards or got industry rags talking, but did little to change how the net was used or help the client's bottom line.
but they are the ones who got the attention. and so unfortunately, much of our work was focused on how to recreate what these idiots were doing, no matter how strongly we could advise to stay focused on the briefs we'd all agreed to. i was considered a pretty good head in a tough meeting because of my ability to convince clients to return to the stated objectives and convincingly so, indeed i've had clients thank me for doing it.
but that's a sad state when the development shop creative's director is the one keeping the client focused on the bottom line - traditionally the only role the client has in that kind of outsourced creative process is to keep their agency on target. but the norm of the dot com age was the opposite.
and that's largely because of the lack of awareness on the part of those responsible, in what they were responsible for. we met marketer after marketer after marketer who'd not one clue about the internet, nor had any intention of coming to understand it. which today we all understand is just silly, given how essentially easy the internet is to deal with, and how critical to the marketing mix it really is, and will continue to be.
but a big part of understanding the dot com era's impact, is in understanding the cultural biases that pervaded at the time to make people feel uncomfortable spending time on a computer, or even guilty.
--____________________
what happened, and why?
simply put, a lot of technological advances came along and rewrote a lot of basic notions of how we accomplish various goals, namely how markets function.
markets are the essential mechanism in which business functions, and since the world is largely one driven by business concerns and influence, many think that markets have become the end all dynamic of how the world itself functions.
this is readily accepted by people with marketing backgrounds like myself, but far more difficult for others to accept, namely those who believe capitalism to be a political concept, rather than a human tendency. but even among those who accept these abstracts, the actual understanding of the mechanics involved are often elusive.
i can speculate on reasons for this, but have no qualifications other than practical experience to make those observations. in general i found that those who failed to understand the dynamics behind what they were responsible for were largely folks who relied on absolutes to determine their mintue to minute decision making.
they didn't realise they were working in a universe that was fleeting from moment to moment, and instead wanted to pretend that they were in a world far more consistent and predictable. they wanted to adopt a scientific relationship to something that was not scientific in nature.
but the real meat of the story behind the fallacies of the dot com era lie in the cultural realities. and the mistake most make here is to lump in all the players into one category, instead of understanding the shifts that were occuring, why they occuring, and how.
the cultures of business are what were changing. the noise we consumers experienced in everyday advertising was largely a bogus reflection of the reality, as much as any cheesy, made-for-TV movie reflected the realities of the sub-cultures they attempt to portray.
that statement in and of itself was actually quite surprising as recently as the mid-80s. it used to be that one referred to Business Culture. but around the 70s and 80s, that became a plural abstract - not singular.
even today, business largely occurs according to whatever realities the marketplace presents us. so if your marketplace is weighed down by a series of regulations which make certain achievements impossible or difficult to execute, then often, the people most willing to break those rules to make those achievements happen will be the successors.
but too often in business, and other arenas which function according to the same market pressures business is subject to - it becomes a game where we manufacture another impression, often even being so bold as to suggest the opposite. in these paradoxes come major realities, eg the Gap's success in marketing 'individuality'.
the real difficulty in defining the various impacts technology had on virtually every walk of life is in understanding just how broad the issue really is. again, we too often limit our perspectives to singular channels of focus, eg looking at the "telecom" industry and proclaiming it some kind of boon industry. to look at such a hotbed of fleeting change, with such broad reaching potential, and actual, impact on so many other areas of concern is just ridiculous. and yet minute to minute, professional analysts earning hundreds of thousands of dollars in salary per annum are talking in exactly those limited terms, as if telecom is in a universe all it's own.
in the late 90s, when one looked at most of the forward thinking in any basic arena, they saw a lot references to concepts like chaos theory, quantum physics and other multidisciplinary studies which tried to look at things holisticly, rather than piece by piece. this perspective clue is critical to understanding the first basic building block of what is happening, and happened then.
specialization nation and other red herrings
everything can be predicted. our understanding of mathematics is too precise and far-reaching to let us believe we don't understand everything in business. economics is a science. what happened yesterday will invariably happen again. one needs to master specialised fields, not understand the convergeance of many disciplines, since our forms of analysis are too well constructed and capable.
these were the kinds of thoughts swimming around most heads of what used to be Business Culture. and the splits which occured in business culture over the course of the 70s and 80s to make that culture very plural were made mostly along these lines, and other equally heretical thoughts.
to understand this is key, and often apparant is the analyst who fails to look at any related issue on the same plane. by isolating our view, we fail to understand the context of our decision making. just like the Far Side cartoon which puts the kid pushing with all his might against the door marked "Pull", by focusing so carefully on what's at eye level, we fail to understand the basic nature of what we are trying to achieve or understand.
and yet, old business culture would have us believe the above statements. that's because business culture went through a long period of not changing much, and that long-running foundation had permeated every last millimeter of business thought. most of those foundations were made on speculative analysis as well, analysis which was based on a lot of notions which have since proven largely ineffective. many, even those who know it to be true, fail to understand that pavlov was the grandfather of Business Culture.
from the beginning of the industrial revolution, to the end of the 1960s, business culture - primarily american, but also quite globally - had maintained an environment that didn't change much, was easily manipulable along those lines and thus enjoyed a series of "truisms" which existed throughout that period, and even carry through today in some cases.
as many business gurus of the 90s commented regularly, it was a patriarchial, top-down culture that was run largely along fascist principles and rulesets. and most who had anydegree of sucess in business via their own accomplishment understood quite readily that business was largely conducted in a below-the-line fashion, run by "old boys networks" where decision-making more often came down to golfing partnerships than anything approaching meritocracy. this was so out of control in fact, that much of the "study" of business was learning things like business ettitquite, were things like proper choices of spouse were advised to young hopefuls.
but when a series of things began to change in our marketplaces and the nature of how they functioned - that culture and set of truisms began to break down quickly. they were challenged by quite a diverse array of upstarts in many guises and even from many cultural angles, but thanks to the stark reality of the marketplace, were proven false everyday by simple execution of a good idea at the right time to prove so.
but again, these realities are clouded by many exceptions or other deviations where some singular success story or failure becomes the presumed recipe for anything else near it.
but if someone wants to put their finger on business trends they need to put down their economics textbooks, set aside their ethics manuals, rest their MBA handbooks, and even consider lessinging their grip on their ancient copy of Art of War.
culture is where the real analysis can take place. the basic assertion i will make about the dot com era throughout this writing is that its reality - its very existence - was entirely the result of a projection of confidence of understanding the potential, and each individual sub-culture's reaction to, and interaction with, that reality.
what each individual was doing at any given point could easily be categorized according to their cultural relationship to the era. their activity and even belief systems could be predicted quite easily by their culture. the only real difficulty lie in pinning down the culture, and this is exactly the incompetence i refer to. such as where managers and supervisors were adopting old business cutlure principles of not giving a damn (MBA manuals still prescibe this) about their charge, but where most analysts or even managers of these middle managers failed to understand the exposure such faulty principles would have in the new arenas of technology being employed.
anytime you identified a major problem of execution, understanding or strategy, you could also pinpoint a cultural bias getting in the way of clear-headed decision-making. as a witness to many ridiculous decisions of the time, i would estimate 90% of the decisions made which proved faulty were exactly because of this kind of segregation of reality and the ability to percieve it.
culture is everything
so how do people who spend 40 years mastering what they do get so incompetent? the people who are the very top of their game, who should define the very essence of specialization, are in fact the least competent? that's mad.
well to understand this paradox of the dot com era - and what some might argue to be a reality today in 2002 - you have to understand the nature of the previous culture. that singular cultural beast i refer to above.
going back to some personal history, and context for how i came to this point of awareness, let me explain my motives and efforts in the late 80s and early 90s. i was married at the incredibly stupid age of 20, and thus focused on earning a good living, making a career for my family to grow from at an age many of my academic peers were just beginning to contemplate psych 101.
problem was, despite a lifetime of high test scores, i lacked the will to suffer the pitfalls of education. i hated school with a passion and instead had spent age 16-21 working and doing things i felt productive - as well as doing what a lot of kids do, and just plain having a good time with friends, living life.
but around 20 i got serious, and i was reading everything i could get my hands on from book stores. i ended up spending hours pouring over what turned out to be many of the more relevant business theory books of the time, and unknowingly had turned myself on to some of the most cutting-edge business thought available.
i say cutting-edge because it was clueing into the cultural shifts taking place, and the technological changes that were incurring massive changes in the essential nature of the marketplace - things obvious to a newcomer like myself.
i had a lot of organisational experience from being raised in a musical activity that spent intensive summers training as a group on the road - and that was one more turn of brilliant luck in an age where oprganisational behavior was going to be key to understanding the definition of the word 'value' in the coming age of change.
and the convergeance of these two realities is what created the most change which caught old business culture off guard. the reality of a changing marketplace combined with a lack of understanding of the organisational beast.
that lack of understanding stems directly from a business culture which believed in that list of thoughts i mentioned before...
"everything can be predicted. our understanding of mathematics is too precise and far-reaching to let us believe we don't understand everything in business. economics is a science. what happened yesterday will invariably happen again. one needs to master specialised fields, not understand the convergeance of many disciplines, since our forms of analysis are too well constructed and capable."
now many from older business culture would deny the above beliefs were ever believed. the dissonence was in evaluating the actions of these men (largely middle-aged, white, males), who, on the one hand would deny this, but who's actions would suggest the opposite.
this kind of seemingly hypocritical movement is however nothing new to old business culture, and many of it's newer cultural descendents, eg modern American politics, and subsequently much of the western world.
--________
MBA culture
if one is genuinely interested in understanding the meat of MBA culture, they need only travel to their local bookstore and pick up a copy of any number of MBA books on the market. the MBA is a higher form of education from the business administration degree most executives attempt to get close to in their careers, and is often prerequisite to executive management in a fortune-500 type of corporation.
much like other judgement calls, it is often confused for an array of different things, but it's more commonly considered a means to getting yourself into a network of people, more than a building block of education. the highest form of education that MBA schools boast of are the introduction of 'case studies' which enable students to look at real-world scenarios and make much more practical observations/decisions about business, than textbook scenarios and hypothesis. this non-scientific approach to business academics is the real innovation.
but until relatively recently, this innovation was only part of the harvard business school program, and more readily available from books off the shelf, than in actual school programs.
the main value in an MBA program lie in it's ability to introduce the student to a large group of like-minded "professionals". and there is considerable value in this, when you understand the other reality of the marketplace - it doesn't come to you, you have to go out and talk to it, you have to create an interest in what you are doing yourself.
the relationships forged in MBA programs often go on to create some of the longer or more successful relationships in executive business careers for decades all over the globe. the more prominent the school, the more likely the success, to the extent that despite harvard's innovations in edcuation, it's biggest selling point remains the appeal of being introduced to the richest and most powerful class of global citizen who occupy harvard's graduating class each year.
most MBAs are not harvard grads however. indeed, an entire sub-industry of MBA education came out of the 80s and 90s and created the powerhouse industry academia has become, because the MBA was sold as a way to distinguish yourself in a large corporation swimming with people who had the same qualifications as you. so most MBAs you meet are only MBAs because they are/were trying to advance in their career, and while they certainly understand what they were taught, fail to consider that what they were taught was largely unproven speculation that required accurate personal judgement calls to even attain any form of value from.
many failed to understand that the reason for the MBA is the network, not the subset of considerations presented. many also fail to understand what they were taught was a series of suggestions and theories, not science. and they have a habit of interpretting trends as equally sound, empirical evidence of scientific absolutes in what still essentially remains a marketplace, still subject to the same unpredictable forces due any function of humankind's fleeting confidence, beliefs and systems of value.
also, MBAs tend to have a very "bean-counting" mentality (they invented it), with the same number of exceptions readily found as anything else. this is a reflection of the MBA culture, a culture largely built on the success of american military and political principles of the early and mid- twentieth centuries. that's because most of america's corporations were built by WWII vets. as was most of the old business culture.
indeed, up to the early 90s, MBA programs often consisted of nothing but the introduction of many basic principles of leadership and management that the US military perfected in WWII and subsequent actions, with credit going to many other militaries who were preceeded by the US, eg vast german military intelligence and principles.
but the cultural changes of the 90s wreaked havoc with this class of people and while certain cultural realities remained in tact - eg those getting MBAs in the 80s being very different to the 90s grads in basic beliefs and approaches - more commonly along the lines of age.
MBA culture is probably still the most volotile of the various sub-cultures one can identify in business today, it ebbs and flows constantly as modern theory continues to intensify in sophistication, and as the screws continue to turn on constructs such as the "old boys networks" of old which still dominate the core of corporate life that MBAs aspire to control and succeed in.
part of that volotile nature lies in the ethical changes occuring in the subset. many less privaledged are entering the culture via smaller or less prominent MBA programs, and as less restricted business opportunites continue to present themselves to a more diverse class of people willing to take advantage.
sample curriculum for harvard business school "executive education"
Business Strategy
* Competing in the Age of Globalization
* Competition and Strategy
* Creating Corporate Advantage: Strategy in the Multibusiness Firm
* Leveraging Knowledge in the 21st Century Organization
* Managing Disruptive Innovation to Create High-Growth Businesses
* Strategic Human Resource Management
the ethics of old are one where people realize that there are what is "supposed to be", and what actually occurs. going back to the understanding of how below-the-line business still dominates decision-making, to understand the modern MBA professional is to understand that they are striving to understand both worlds. often by occupying the activity of one trying to master "what is supposed to be", all the while profiting from knowing and understanding the intrinsic nature of the below-the-line activity that more often determines reality.
there is a similar parallel in sales or advertising principles. one would expect a professional copywriter to reflect perfect English rules in their execution - perfect grammar, spelling, etc - but often copywriters are at their most successful when they break said English rules. the copywriter straddles both worlds to achieve a profit goal for its client.
the MBA tries to be the copywriter and know when to break the rules and how to achieve the "higher" business goal of profit. that's usually referred to as "competition", or competitive activity. instead of the definition most laymen think of, one where merit and market efficiency determine outcomes.
sometimes that means breaking the rules of how to treat people (eg putting distance between yourself and your charge to avoid "unecessary" personal relationships and influence), sometimes it means working below the line to make the impossible happen, sometimes it's the more legit mechanic of simply putting the most resources into something.
the MBA is not a tattoo of someone's evil side however. as said before, this culture is undergoing massive change right now as the new guard enter with these more abstract and holistic notions, and the old guard staunchly protects its freefalling ideology of 19th century theories long since proven faulty.
but understanding the various subsets of the culture reveal important clues as to 'how' and 'why' on this issue, because when you look at most of the decision makers out there in most critical functions of the world - you'll find they are MBAs, or lawyers - one of the two, or possessing extensive knowledge of either subject.
the liberal extreme presents an interesting realization in light of this cultural breakdown, along more geo-political lines.
--___________
salesman culture
i use the term salesmen because that's what drives the culture. even successful women in this culture tend to be more manly in their approaches and methods than other males. sales is a male culture that has little to do with typical female concerns of social peace and fulfilment, and everything to do with making the deal go down by applying any degree of grease or violence necessary. two hated rivals can instantly become good friends in sales if the bottom line warrants it.
sales is an ancient trade, second oldest as far as i'm aware, although i would note that without that first John, the first trick never would have been turned were it not for a little sales magic. and simply put, nothing has actual value until it's been bought. however, this little principle is one that has a tendency to evade even the sharpest business minds.
personally, i got into sales as a life line. i had no college education when i needed income, so the only white collar job available to me with some decent earning ability was sales. this was true in both the US and the UK over the course of the late 80s and early 90s. sales is the one area in most companies where you don't need experience, and where plenty of work is available in recession. you had to know someone to get into blue collar work where i came from (blew my shot when i failed a math test of theirs, despite an academic career with math honors - great at geometry, suck at algebra).
what you do need, is to bring in sales. and this can be achieved any way necessary, just so long as you don't bust the company in the process. as a result, salespeople are usually paid based on commissions which grow larger as they sell more products or services.
and so long as you do this, you may well be the highest paid employee in the company, even if actually making the product is the most difficult and dangerous task on earth. that's because if the salesmen doesn't exist, then most organisations have no revenue. and a company without revenue is not a company.
amusingly, the salesman is also usually the least powerful individual in the company, alonside being the highest paid employee. there are certainly exceptions, but in general salespeople tend not to have any control over the design and construction of products or services, and tend to have nothing to do with any of the executive decision making.
and most salespeople don't want these responsibilities. ideally they want to pick up the phone for about 5 minutes a day, make their one amazing sale and then call it a tough day and go to the bar and get drunk. this is in fact why most people get into sales - the promise of being able to maximize sales with minimum effort and be rewarded amazingly in return for simply having the sparkling personality necessary to keep everyone employed one more day.
the resulting personalities tend to have prima donna tendencies, unrealistic perspectives on the workings of the rest of the organisation, but incredibly realistic ideas about the likelihood of success in any given field of sales. they tend to hate work and much prefer to simply rely on the knowledge that their job is irreplaceable to most organisations. sometimes pusuing this ideal can generate alot of mental work which tends to exhaust the sales professional, but i don't confuse that for hard work.
they tend to be great with people at face value, superficially, but horrid with people over long, intensive periods of time.
there are many levels of sales achievement, and capability, but they tend to rely less on what you know and much more on who you know. 99% of the time, the salesperson is being hired because of their list of contacts, not because of any specialized knowledge they may bring to the organisation.
sales is also used as a training ground for several types of executive management, eg most young marketers are required to spend a year in the field as a sales manager or sales person to fully understand the pressures before making more broad marketing decisions for a company.
sales is tough. it's all about personal rejection and acceptance. and as a result - honest, sensitive types tend to fail miserably in sales, usually sometime shortly after their first personal rejection. each time you try to make a sale and fail, most people lose the will to try again.
and it is exactly this knowledge that continues to pay the salesman so much in relation to such a small amount of actual productive work for an organisation. the salesman is the one area of capitalism where all the rules of decency and humanity go out the window and nothing makes sense unless it's spelled m o n e y.
the only thing to bring us all back down to reality is the value of the cash at the end of the sale. then it all makes sense. when your annoying, superficial and lazy, but white-hot, salesmen brings your company 80% of your revenue (or several million dollars), then paying them $300k - while still more than what anyone else gets - is really quite easy.
the alternative is to earn several million dollars less. salesmen know this, and so do most successful business people.
sales has been changing radically from the 70s and 80s however, just like the motivation for obtaining an MBA has changed, as have countless other aspects of modern business.
it used to be all about simple mathematics. it used to be, you could make fairly accurate projections of what your sales effort would return you in revenue, and one could consistently achieve this taking by reproducing a given sales effort. so boiler rooms would be set up with exactly 10 telemarketers per 1,000 leads available daily, and a company could expect to have sold X amount of product or service by the end of the week.
we're really that predictable, and sustain millions in revenue and employment with this predictability. so i find it amusing when the very same group of people - us - sit around and discuss how it's the 'other' people who are sheep. but i digress...
much like everywhere else, as technology and media continue to fold the marketplace into something entirely different - these sales principles started going out the window.
people became much more sensitive to traditional sales tactics and even went so far in many cases as to become offended by coming into contact with them. this is where we stop being sheep. and for us to stop being sheep, essentially breaks the traditional molds and formula.
the marketplace got finnicky about how they buy stuff, and grew tired of the shoddy, superficial treatment this traditional form of sales brings to the social experiences.
the fundamental changes in the retail car market which occured in the late 80s and early 90s is an excellent example of this. saturn capitalized on the growing dissatisfaction people felt with the traditional american car purchase procedure which usually included several hours of negotiation with a high-paid professional salesmen (who is in a rush for the bar, don't forget).
people just want a fucking car, not a challenge in the sales arena with a professional snakeoil salesman. but that desire of people doesn't help the endless middlemen in the car market make their commissions, so it's no wonder it took till the late 20th century to devise this kind of sales procedure.
some people believe that sales is a last ditch thing. if you have to rely on sales-driven processes to keep your company afloat then you must not have much of a product or service to offer people, or you are running the company in a particularly inefficient way. and there is some real logic, and truth, to this.
the problem is the lack of creativity in executive management which more than often leaves them unable to devise the actions or answers to the problems they face, and instead rely on their traditional training to tell them they need to employ more salespeople.
often it's a case where the company is no longer being run by people who understand the value of their business to customers. for example, companies bought by larger companies to increase given marketshare, may find themselves with a completely useless company if the market suddenly changes with the introduction of a new innovation. often the new owners of the company will replace older managers, not realising they lose their ability to understand their product's value to the newer marketplace in the process.
when the value shift occurs in the marketplace, the new managemenet is unable to percieve that shift in value and make (in)appropriate adjustments to their own product in the process. the result is a set of managers with no idea how to achieve their revenue, or sales goals. enter the professional salesman.
now, i've made a lot of broad statements. but one needs to bear in mind that at the highest levels, the salesman is also the CEO, and even possibly the founder or the one who actually makes the product or conducts the service. in this case, the disconnected value aspect of traditional sales will not apply - because the salesperson is proactively making sure they understand these market changes.
but this is still rare (so rare, the few who occupy this station tend to be the CEOs who stand out and get books written about them, etc - but this inherent talent remains contained in these cases). part of the shift that's been going on in sales since the late 80s is the realisation that even disconnected sales departments can still strive for these kinds of ideals, and become a more interested and capable (knowledgeable) part of the whole team, and thus conquer a lot of these traditional pitfalls of sales.
but when you look around, very little of this translates into results that aren't really much more than a more comprehensive superficiality. indeed, most instances i can think of, the salesperson actually felt more superficial because the issue really was way beyond the salesperson's comprehension, and the new expectation put uncomfortable pressure on the salesperson to try be something they're not. it's rather embarassing.
having said that, i've met salespeople in the early 80s who understood these things intrinsicly and simply worked overtime to understand the tough stuff. there are no absolutes.
sales culture in general frightens me. there are a few exceptions, but in general when you encounter a large salesforce, and especially a well-paid via commission sales force, then you are dealing with a dodgy product or service. one that is seriously questionable in actual value.
it's always been my experience that the worst products and services always have the best sales teams.
but we can't forget, sales is the expected norm for how the majority of products and services enter the marketplace.
sales is also the actualization of the Old Boys Network, to a certain extent. the old boys network is a fleeting thing, as today there are many Old Girls and even Old Brown, Yellow, Black, and Blue Boys. but in the everyday world, outside the high-flying antics of the top 5% in business - the Network appears in the form of sales.
sales is an artform that relies in fact on a lot of the prejudices and superficialities of everyday life. and much of sales is done in the bar, on the golf course and over a fine sushi lunch. the seediest sides of capitalism occur in the sales process. there is no ground that can't be covered in the verbal contracts of sales, and it is easy to forget that sales is often what makes the impossible possible. very rarely do we understand the negatives that are incurred when this happens, usually because there is an upside to our organisation or our individual paycheck.
but this nasty pit of superficiality and the willingness to sell your own grandmother down the river with out a paddle is often what defines this culture. salespeople understand their critical role to an organisation with the means to amass wealth, but the inability to sell their crap to people. and they have a tendency to work it for all it's worth.
i'm sure there are really nice, sensitive, caring sales people out there. i just haven't yet met any in 15 years of milling around two continental markets. it's a cutthroat culture that has no problem deriving all of their worth from the work of others, and the culture reflects this. the salespeople i know would respect my honesty here, understanding i have no desire to challenge their skills.
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Engineer culture
my favorite cartoon of the time was a picture of two dogs sniffing each others tails, describing an initial engineering meeting between client and vendor. engineers were the intellectuals of the time, but usually from a purely technological standpoint. where technological skill and experience abounds however, other critical market fundamentals were often lacking, most obviously 'social' skills. engineers were the alchemists of the time, and still are, and the cartoon lampooned the rituals they would incur to sniff out each other's competence - something that was often very elusive.
engineers mostly swam in pure logic, and often failed to account for any other force in nature. a small percentage of engineers had the ability to look at many other facets of market dynamics and were often deemed visionaries in the process, indeed a lot of the futurists were engineers or former engineers who possessed some degree of this ability.
but for the most part, engineers remained high-priced talent - a worthy cost - who largely did what they were told, or rose to the challenge presented to them. many engineers sat around and got fat too.
while many dot coms were run by engineer CEOs, it was rare for an engineer to strike out in such independent form. engineers tended to follow a very typical academic nature, where the common belief was in a career of jumping from company to company as a respected engineer. especially at the time i got close to silicon valley in the mid-late 90s, it was rare to run into an engineer who had any idea of how to even approach going solo, while we all knew one or two who was.
usually it was the super, high-ticket engineers who did this, but that was because their salaries let them think that way. a good oracle programmer, for example, could expect to work for only a few months a year and pull down over $100k per annum. and i knew of folks who did exactly that, and may still.
that's what the old specialized knowledge thing can earn you in an economy that values it that much.
and in this key point, you will understand the crazy valutaions that occured in the dot com era and how and why they came to be. i'll go into much more detail about this in the pluralistic ignorance chapter below.
the key thing to understand about engineer culture in relation to this point is that engineers in the dot.com age were like doctors in the american civil war. few and far between.
that's why they got paid what they did, and had the leeway they did. simply put, no one else could, and our educational facilities were so complacent, and so far behind the times, that often the only capable programmer was some punk kid from a washed-out suburban neighborhood who had no respect for any of the institutions which would go on to empower him (hers usually did) to make their latest and most profitable product. in the worst extreme anyway.
but ignoring this kind of culture clash potential and ultimate conflict, is like ignoring racism in evaluating WWII.
the final thing about engineers i feel important to understand is that, collectively, they were probably the most synchronized in motive, ambition and method. they typically came through the exact same educational process, one of two or three basic paths - self-taught, university educated, business educated - and there was a strong familiarity with each path among them. this built a series of cultural traditions and beliefs which made bouncing from one lunch of engineers to another almost identical.
they spanned a lot more than programming however, and comprised a massive army of technical orientations that spanned every possible facet of life. and they were all incredibly smart people. just terribly naive about the dynamics of the world in which they worked.
not unlike many of the rest of these cultural groups i'm describing.
entreprenuer culture
entreprenuers are a multi-discipline class, that is really - and exactly like the CO class - a subset of all other classes.
entreprenuers were often the catalysts in the dot com era, but also the dot com era's riskiest class to work with. most of the neglegent orientations of the dot com cultures came from the entreprenuer and CO classes. the entreprenuer was the underclass, the CO being the overclass.
the entreprenuers understood the meaning and consequence of value. they were the ones who were around to make a quick buck and get out, or the ones who wanted to spend a lifetime tinkering and coming up with new ideas - but had to do it themselves. they were mostly comprised of people who'd worked their buns off in the last recession of the early 90s and late 80s and failed miserably, or been kicked around for years in a dry market and were bitter about what they felt to be incompetent and complacent managers. i consider myself to be part of this class as a subset of marketing, so i am no doubt projecting my own personal biases here as well, many entreprenuers were motivated by much more positive means, and also much younger than i, as well as much older. but i was awed by how many like-minded peers i would come to meet.
entreprenuers understood their goal and their opportunity. they were aiming for a number of prizes which varied according to their circumstances. if they were young and hungry like me, any form of buy-in to the system was acceptable. amassing some wealth, fame or power was enough, as it would overcome whatever was lacking up until that point.
but many were also just adding to an already successful portfolio, or were just intuitively bursting with ideas of how to exploit the new medium.
consider brad mcquaid's story. he was a lifelong fan of dungeons and dragons, and via school learned how to program computer games over the course of the 80s and 90s (i presume, i don't know his personal history before 97 too well). he gets the idea to take an existing game and turn it into a game that functions more like a MUD, where the game is a dungeons and dragons RPG which is a persistent online world. this idea is not new, but using the game engine they had, it made it the first time a game like this could be experienced in the 1st person perspective, and hundreds of thousands of people starting playing the game.
the real revelation was that the game had a subscription fee since it was a never-ending persistent world that needed maintenence, so created a massive market of people spending 10 bucks a month to play this game. the company, verant interactive, was bought by sony entertainment and is now essentially heading the charge sony is making against microsoft in the networked gaming market.
a market that as of today is already beating much of the rest of the entertainment market. but brad's game is much more than a simple market success story - it has made a fundamental jump in entertainment concepts as a whole.
it has brought in whole new category of gamer. soccer moms, african americans, girlfriends, navy personnel, moms & dads with their kids, south koreans, retired men, even major league baseball players are playing this game, which is now 4 years old.
the gaming market is slowly transforming from a purely 12-17 year-old white male activity, to something that everyone is seeing the appeal of. and it's because games are slowly transforming from murder and slaughter games, to social ones, that take advantage of the internet's ability to connect thousands of people together at once, in a social setting.
that's just one example of the entreprenuer subset of the engineer culture. brad is a creative director, he will be the key strategist in his new company (he left sony after a few years of successful handoff of everquest to them, on good terms and with a lot of cash from the sale of verant to sony, to start up a new game company), and in that regard would be indentified as a more progressive, independent, and even creative engineer (while many in the industry would think of him as stale and old guard, no doubt).
each cultural category has this typical breakdown, where there is a spectrum of more rigid, less-creative types who are brilliant in other ways, to this creative/visionary end of the spectrum which tends to be the catalyst for new ideas actually coming to fruition.
this is the rock-and-roll star part of the culture that many found time to dwell on and spawn new urban myths about every day.
and yet today, i hear many people say that CEOs were considered "rock stars" as if people were treating the CEO of morgan stanley as a rock star, when they weren't. the rock star treatment and meme was often only afforded the more eccentric types as they are today, from richard branson to larry ellison - but guys like bill gates weren't thought of as rock and roll stars. just like today.
bill gates represents the other side of the spectrum - the lack of creativity and innovation is made up for in clarity of perspective on things like marketing and strategic deal making. bill gates didn't even see the value in the internet until late 96. this is not a technical visionary. and most engineers, beyond microsoft techs, would agree with this long legacy of actions to determine mr gates' true innovative qualities. to the extent it still angers people to listen to bill gates defend microsoft's tactics as necessary to continue to "Innovate" for their customers, when most engineers know that microsoft hasn't been responsible for a single technological innovation since the mid-80s, while they now seem to own most of any innovation that others have since made possible. again, gates is the other side of the spectrum.
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CO culture
"i want to control and drive everything". this is the focus of the mentality while it plays out in one of the more diverse arrays of personalities possible, perhaps emphasised by the complexity of the individuals involved. there are many justifications for how people end up being a CO type, but the culture is overwhelmingly stereotypical once you crack open this group. a lot of which is derived from the pluralistic ignorance principles talked about below.
COs as a culture would include any chief operations type role, and more typically are folks like Presidents and CEOs. CFOs and CTOs are often a product of the CO culture and include themselves in that melee, but many CO positions which focus on lesser entities of companies value are often not the typical CO personality. like any other category, it really will vary according the individual personality, and there are always exceptions.
COs are not employers, not really employees, and while they own, the tend not to act as owners. of course, they are employed by the company, and even tend to be the founding members of a given organisation, but the way they approach their role, the market, the business and it's cycles is like a businessperson - not like an american taxpayer looking for work.
what this means is they understand a lot of basic valuation formula. they understand that the chances of them being CEO of the company they currently are in a number of years is exceptionally low. even if they are brilliant, the chances the company they are running will even be around (see: successful) in 10 years is incredibly low. i'll talk much more about this in the Cycles section below.
the resulting conditions are the cause for their various career strategies. career strategies that often have little to do with creating a long-term, profitable, responsible company. the only reward in that is to be a massive investor, or a founder or something, so there is little emphasis on this in the mindset of the CO of the public sector.
what COs have perfected is the business of perception. much like the marketing category, COs are masters at how to manipulate perception - be it employee perception of what their comapny is up to, or shareholder perception of what their company is up to, or outside perception of what the company is up to.
so when something goes right in the organisation, there is a good chance the CO types will be very close to looking responsbile for some reason, even if they never had a hand in that success. when there is anything close to an opportunity for the company to exploit the local scene and appear to be doing some community good, the COs will have jumped all over it. when negative things are discussed, you will be baffled how at the end of the 30 minute explanation the COs will have convinced you that not only are things not bad, but actually look better than ever.
conversely - and this is how you would have to call them on their claims of acting out of meaningful responsiblity, and not opportunity - wherever those opportunities exist, but at cost to the company, they won't happen. there is a classic monty python skit which describes the causes for this reality very well.
a man seeking donations for an orphanage walks into an investment bankers office and asks him for a 1 pound donation. this immediately confuses the banker as he doesn't see what it is he gets in return for his 1 pound. after finally explaining to the banker that people just give the man donations in the street and don't get anything in return - the banker goes wild with the new realisation that you could simply ask people for money. after asking for a list of those names who gave him money, the banker declares the process a miracle and the man a genius, and says "now there's a business idea worth a pound!", while the orphanage man breaks a smile thinking he's finally going to get his pound donation the banker picks up again, "the snag is... you've already told me the idea", whereupon he then ejects the man from his office.
COs have a number of basic requirements that help explain this focus and consistent methodology.
first, they understand they will never control their own world from anything other than a CO position. ultimately, they may desire to simply be a non-working dividends earner - but until that day, they have no desire to follow the lead of anyone else. no matter their ultimate goal, one thing they cannot accept very well at all is working under or for others. entreprenuers are similar in this manner, indeed this is where the two are closest, the difference is the CO will do what it takes to get to a higher position, and so will enter into whatever arrangements forced on them, whereas the entreprenuer will walk away if the conditions don't suit them.
second, they are mor |
